The real unemployment number

Forgive me if I don’t make sense today. I’m going to take a bucket of water and pour in a few drops at the top. Let’s call that job creation. What I’m going to gloss over is the gaping hole near the bottom where water is gushing out. Some skeptics might call that people leaving the labor force, but the shiny objects are those droplets of water and the trickle from last month we found was larger than we thought. So the bucket seems really full.

For the first time since 2008, the “topline” unemployment number is under 7 percent, as it was announced today that the rate dropped to 6.7 percent. But experts were “hard pressed” to explain why so few jobs were created.

The problem was summed up by someone who’s not an economist, but a frequent critic of the current regime. Nathan Mehrens of Americans for Limited Government noted:

Since Obama became president, the number of people who are considered to be in the civilian job eligible population has increased by just shy of eleven million people, but the number of people who have entered the work force has only increased by about 730 thousand people.  Quite simply our nation cannot survive when fewer than sixty six out a thousand working aged people are entering the workforce.  Of those sixty six who want a job, about five of them are unemployed.

I’ll grant that the Mehrens example is perhaps a little overblown, as more of those who would be considered job eligible also become eligible for Social Security and/or reached retirement age. There are also a growing number who claim disability, which is why the seasonably adjusted number for those not in the work force has peaked at 91.8 million while the labor participation rate slid back under 63 percent. They’ve talked for years about the fact that a shrinking number of workers contribute to Social Security while those who collect live longer; well, we’re now practically at a point where five workers support three who aren’t working. Nor do these raw numbers consider how many jobs are in the public sector vs. private sector work, so the ratio is just about to a point where one private-sector worker is supporting one of either the roughly 22 million public-sector workers or the nearly 92 million non-workers.

Bottom line: the system trend is unsustainable, So what is the solution being offered by the government? Barack Obama calls them “Promise Zones” and they are supposed to “cut through red tape.” But it looks to me like more of the same:

(Yesterday), in the East Room of the White House, the President will announce the first five “Promise Zones”, located in San Antonio, Philadelphia, Los Angeles, Southeastern Kentucky, and the Choctaw Nation of Oklahoma.

These areas – urban, rural, and tribal – have all committed, in partnership with local business and community leaders, to use existing resources on proven strategies, and make new investments that reward hard work. They have developed strong plans to create jobs, provide quality, affordable housing and expand educational opportunity, which we’ll help them execute with access to on-the-ground federal partners, resources, and grant preferences.

“Make new investments” is codespeak for spending more money on the problem, and Democrats just love to utter that “investment” term. That makes sense when the vast majority of the proposed solution lies in more federal involvement. (There is a small component involving tax credits, but those are generally temporary and don’t cover all of the increased costs involved in locating in these areas.)

So the one-to-one ratio will probably continue, particularly since the first five mainly involve some sort of educational component. Of course, that won’t be done through private-sector means.

Has anyone thought to ask those who create jobs what gives them an incentive to do so? Certainly tax credits may help, but as I noted above those are of a fleeting nature. Unfortunately, it seems that government regulation is forever; well, at least until business learns to live with that which is in place – only then do the bureaucrats seem to change things for the worse. One study pegged the net cost of government regulation in 2013 at $112 billion; using that as a guide business spent that sum complying with regulations instead of creating 2.24 million jobs at $50,000 apiece. That would knock nearly one-fourth off the unemployment rate, putting it back to around the 5% “normal” the media regularly lambasted as a “jobless economy” during the George W. Bush years.

It seems like politicians pay lip service to the concept of business friendliness during election years because they know the voting public really, truly wants to work and advance their economic status. (I know I do.) Yet the results of the last half-dozen years or so have been those of government projecting more of its influence over the private sector when the reins should be slackened instead. In no way has the world reached a terminal point of satisfaction with its collective lot, so there’s much room for growth in the American private sector given the advantages our nation has in terms of natural resources and willing workforce.

So let my job-producing people go, and we can return to the full employment we enjoyed just a few short years ago.


One Response to “The real unemployment number”

  1. JWB on January 10th, 2014 12:27 pm

    There’s also a large skill-gap caused by government’s manipulation of the market, resulting in “tech schools” rather than apprenticeships (making it all look the same) and diversion of large segments of people into standard colleges who do not do well there.

  • I haven't. Have you?
  • 2018 Election

    The Maryland primary election is June 26.





    Larry Hogan (incumbent) – Facebook Twitter



    Rushern Baker – Facebook Twitter

    Ralph JaffeFacebook

    Ben JealousFacebook Twitter

    Kevin KamenetzFacebook Twitter

    Rich MadalenoFacebook Twitter

    Alec RossFacebook Twitter

    Jim SheaFacebook Twitter

    Krish VignarajahFacebook Twitter

    Candidates for Libertarian and Green parties will be added after primary.





    Anjali Reed PhukanFacebook Twitter



    Peter Franchot (incumbent) – Facebook Twitter


    Attorney General



    Craig WolfFacebook Twitter



    Brian Frosh (incumbent) – Facebook Twitter


    U.S. Senate



    Tony CampbellFacebook Twitter

    Chris ChaffeeFacebook Twitter

    Evan CronhardtFacebook Twitter

    Nnabu EzeFacebook

    John Graziani – Facebook

    Christina GrigorianFacebook Twitter

    Albert HowardFacebook Twitter

    Bill Krehnbrink – Twitter

    Gerald Smith – Facebook Twitter

    Blaine Taylor

    Brian VaethTwitter



    Ben Cardin (incumbent) – Facebook Twitter

    Erik JetmirFacebook Twitter

    Chelsea Manning – Twitter

    Marsha Morgan

    Jerome SegalFacebook Twitter

    Rikki VaughnTwitter

    Debbie “Rica” WilsonFacebook

    Candidate for the Libertarian Party and the independent will be added after the primary.


    U.S. Congress -1st District



    Martin Elborn – Facebook Twitter

    Andy Harris (incumbent) – Facebook Twitter

    Lamont Taylor – Facebook Twitter



    Michael Brown

    Jesse ColvinFacebook Twitter

    Allison Galbraith – Facebook Twitter

    Erik LaneFacebook

    Michael Pullen – Facebook Twitter

    Steve Worton – Facebook Twitter

    Candidate for the Libertarian Party will be added after the primary.


    State Senator – District 37



    Addie Eckardt (incumbent) – Facebook Twitter



    Holly WrightFacebook


    State Senator – District 38



    Mary Beth CarozzaFacebook Twitter



    Jim Mathias (incumbent) – Facebook Twitter


    Delegate – District 37A



    Frank Cooke



    Charles Cephas – Facebook

    Sheree Sample-Hughes (incumbent) – Facebook Twitter


    Delegate – District 37B (elect 2)



    Chris Adams (incumbent) – Facebook Twitter

    Mimi GedamuFacebook

    Keith Graffius – Facebook

    Johnny Mautz (incumbent) – Facebook Twitter



    Dan O’Hare – Facebook


    Delegate – District 38A



    Charles Otto (incumbent) – Facebook



    Kirkland Hall, Sr.


    Delegate – District 38B



    Carl Anderton, Jr. (incumbent) – Facebook Twitter


    Delegate – District 38C



    Wayne HartmanFacebook

    Joe SchannoFacebook Twitter

    Jim Shaffer

    Ed TinusFacebook

  • Categories

  • Archives

  • Link to Maryland Democratic Party

    In the interest of being fair and balanced, I provide this service to readers. But before you click on the picture below, just remember their message:

  • Part of the Politics in Stereo network.